When working on your own home improvements, shopping at a big-box retailer offers you the most convenience at a fair price. But when you're flipping houses and need to make the most profit, you might miss out on better options if you stick with the same routine.
Taking the time to research local suppliers as well as online sources for shopping for home improvement items will pay off in the long run if you plan to make flipping houses a long-term source of income.
First, let's look at some ideas for finding local suppliers:
• Specialty Businesses: Often, specialty shops such as plumbing supply houses, drywall suppliers or flooring specialists can offer the best prices because they focus on one item and purchase in bulk, rather than filling up a warehouse with a little bit of everything. If you find a locally owned store, talk to the owner about what kind of deal you can get. Finding new customers is costly for locally owned business, so if the owner finds a potential repeat customer, they gain by making you a loyal customer, even at a discount. These suppliers also get good deals from time to time, such as if an item is being discontinued, and are willing to pass along the savings to their regular customers in order to move the money quickly. If you are working with a contractor, they should know all these types of businesses available in your community.
• Hardware Store: You can address the opposite need here. If you need just a few small, specialty items, a local hardware store will sell little by little. Why buy a box of 100 eye hooks if you only need 4 for your current project and don't foresee a need for them ever again? While buying in bulk will pay off for a lot of items, you don't want to have to fill up your limited storage space with excess items you won't need again.
• Recycle Opportunities: Whether it's a thrift store, an architectural salvage store or a Habitat for Humanity ReStore, you might find good deals or pieces that can add a unique look to your flip. Of course, you'll spend extra time looking and need to be creative in your thinking, but that's part of the fun of being your own designer for your flips, too. Some communities even have a local recycling program where people can bring their old paints and they are mixed into vats of neutral colored paints and sold cheaply.
You've probably heard, "You can find anything on the Internet." You can find good deals on home improvement products, but you need to be wary of scams and make sure you understand your entire cost, including shipping and applicable taxes.
It also may be you are in an area where you can't find all the products you need easily, so you'd be paying the shipping anyway.
While we don't want to advocate for specific businesses here, you can certainly easily search for products you need. There are wholesale online clubs that can ship a lot of the small stuff at great prices, like drywall, plumbing, electrical supplies and more. If you have storage room, you can buy in bulk and spread those costs through several home.
You also can find bigger-ticket items such as wood or laminate flooring, carpeting, tile, appliances and more. Just understand those shipping and storage costs if you consider this route. Also, make sure you get the items in a timely manner as you don't want these purchases slowing down your timeline.
Speaking of storage, if you have access to storage, you can save considerable money buying in bulk. If you have a dry place, you can keep lumber, drywall, shingles, etc. and use it for several projects. This also does require more up-front costs, but once you are up and running with a full-blown flipping business, these savings will make a huge return on your investment.
One way you can consider making an up-front investment in bulk purchasing is to leverage your investment with loans for your purchase and rehab of your flip houses. Contact us about how we can help with those decisions.
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